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You've probably heard it a thousand times before: life insurance should be secured for every working member of your family, but have you ever stopped to consider if the term "working" should be taken literally?
According to the last U.S. Census Bureau, the number of stay-at-home spouses is on the rise in many American households, and without employer-sponsored life coverage, many have become non- or under-insured when it comes to life insurance. The common, and often misinformed, school of thought is that since only one spouse is bringing home a formal paycheck, the family only needs to consider the loss of income should that "working spouse" pass away. While it's true that your stay-at-home spouse may not receive a W-2, there's a high likelihood that he/she is also a big contributor to the financial well-being of the household.
Consider the value that your stay-at-home spouse offers to the home:
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Caring for the kids
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Cleaning the house
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Maintaining the bills
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Grooming the yard
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Running routine errands
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Helping with homework
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Preparing meals
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Carpooling the kids
Often times, these responsibilities are overlooked, and the truth of the matter is that should your stay-at-home spouse pass away, someone will still need to take on all the activities that he/she was performing on a day-to-day basis. In order to maintain the lifestyle that your family has become accustomed to, one or several people may need to be hired to ensure all the necessary responsibilities are being met.
You may need to pay for:
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Child care or after-school care
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Errand running by an assistant
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Landscaping services
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A cleaning service to maintain the house
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Transportation to school
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After-school tutoring
- Etcetera, etcetera, etcetera
So, contrary to popular belief, stay-at-home spouses aren't necessarily leading the life of leisure during the day. In 2013, Salary.com estimated that to hire a replacement for all that a stay-at-home spouse does would cost approximately $113,000/year, so it's important to consider all the day-to-day tasks your stay-at-home mom or dad does when determining the amount of life insurance your family needs.
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